ShadowTraderPro Swing Trader for January 13, 2010
The ShadowTraderPro Swing Trader is your every
morning dose of market reality brought to you from the resident geniuses
at ShadowTrader. Overseen by Chief Equity Strategist, Peter Reznicek, each
issue contains a full report on the prior day's action, including market
internals, technicals, and what sectors were hot and cold. Each issue also
includes the ShadowTraderPro Model Portfolio, which updates members on
what stock plays STPro is currently engaged in officially, as well as
provide a daily list of long and short setups for more self-directed
traders and investors.
To get the most out of your subscription,
please read our Swing Trader User's Guide
If you have any
questions or comments regarding commentary or plays in this newsletter,
please email to swingtrader@shadowtrader.net.
The Big Picture
Good morning, traders. In the context of the S&P 500 Index (SPY) beginning the new year with a string of six consecutive higher closes, yesterday's pullback can be classified as "healthy". It started the process of bringing many stocks that were overextended back into price ranges that would be more desirable to buyers. In the context of being resilient enough to brush off disappointing news however, the market seems to have changed. It's reaction to the disappointing Alcoa, Inc. (AA) earnings is telling us that the market is now much more sensitive to negative news than it was a few months ago.
We will now carry these two interpretations forward to put them together with other pieces of the puzzle that will be revealed by the market over the next 7-10 days of trading. One more day of selling like yesterday's would still be in the realm of normal. However, selling beyond that would alert us to a deeper cause than just stocks being overextended and we would then consider the need to change our market bias from bullish. Unless this occurs though, are watching and waiting to pull the trigger on long entries. The ShadowTraderPro Model Portfolio is in a very good position to take advantage of a pullback by the market as we now hold only one stock (PPL) long.
Of the sectors on our "pullback radar", the Oil Services Sector ($OSX) is one at the top of the list. Let's look at it's daily chart below.
$OSX has recently started a new uptrend. Based on the average daily trading range, the sector is approximately one and a half days away from making the first touch of the ascending magenta trendline. Before it reaches that level however, we will have our list of $OSX component stocks prepared to choose the best positioned amongst them to move higher as the $OSX reverses off the trendline. Names in the sector that currently have the best chance of setting up for a long play include BHI, BJS, HAL, NBR, NE, and SLB.
Under The Hood
When we say "under the
hood" we mean market internals, ie: what was really happening behind the
scenes. ShadowTraders who listen to our daily broadcast every day live on
the thinkorswim platform know that all closing figures on the major
averages should only be interpreted in the context of market internals.
Look for convergences and divergences in the breadth, a/d line, and trin
figures below to either confirm or cast doubt on what all those talking
heads on TV are telling you.
| Dow Jones Industrial Average | 10627.26 | | | -36.73 | | -0.34% |
|---|
| S&P 500 | 1136.22 | | | -10.76 | | -0.94% |
|---|
| Nasdaq Composite | 2282.31 | | | -30.10 | | -1.30% |
|---|
| Nasdaq 100 | 1861.79 | | | -24.45 | | -1.30% |
|---|
| Russell 2000 | 635.50 | | | -8.49 | | -1.32% |
|---|
| Spot Gold | 1127.60 | | | -23.80 | | -2.07% |
|---|
| Crude Oil | 80.02 | | | -3.36 | | -4.03% |
|---|
| NYSE Overall Volume | 1,096,957K | | | n/a | | +13.39% |
|---|
| Nasdaq Overall Volume | 2,397,466K | | | n/a | | +13.67% |
|---|
| NYSE Breadth | 4.45 : 1 | | | Negative | | |
|---|
| Nasdaq Breadth | 3.04 : 1 | | | Negative | | |
|---|
| NYSE Breadth Ratio | 18.34 | | |
|---|
| Nasdaq Breadth Ratio | 24.74 | | |
|---|
| NYSE Advancers/Decliners | -1339 | | |
|---|
| Nasdaq Advancers/Decliners | -1177 | | |
|---|
| NYSE Trin | 1.74 | | |
|---|
| Nasdaq Trin | 1.20 | | |
|---|
| $VIX | 18.25 | | | +0.70 | | |
|---|
| ES Pivot Points for Wednesday |
| R3 | 1155.91 |
|---|
|
| R2 | 1151.33 |
|---|
|
| R1 | 1146.91 |
|---|
|
| Pivot | 1142.33 |
|---|
|
| S1 | 1137.91 |
|---|
|
| S2 | 1133.33 |
|---|
|
| S3 | 1128.91 |
|---|
|
| Strongest Groups: | Biotechnology | | | Insurance | | Utilities |
|---|
| Weakest Groups: | Gold | | | Semiconductor | | Oil Services |
|---|
Heads Up
Up and coming economic
and corporate data that may move markets this week:
Today - 01/13/2009
10:30 am EST - Crude Inventories02:00 pm EST - Fed's Beige Book02:00 pm EST - Treasury BudgetReporting earnings today: There are no stocks $20 or more trading at a volume greater than 500k reporting earnings today.
Thursday
- 01/14/2010
07:45 am EST - ECB Announcement08:30 am EST - Initial Claims08:30 am EST - Continuing Claims08:30 am EST - Retail Sales08:30 am EST - Retail Sales ex-auto08:30 am EST - Export Prices ex-ag.08:30 am EST - Import Prices ex-oil10:00 am EST - Business Inventories10:30 am EST - EIA Natural Gas ReportReporting earnings today: SCHW, LPL, INTC
Friday - 01/15/2009 08:30 am EST - Core CPI08:30 am EST - CPI08:30 am EST - Empire Manufacturing Survey09:15 am EST - Capacity Utilization09:15 am EST - Industrial Production09:55 am EST - Mich SentimentReporting earnings today: JPM, HDBBulls and Bears
This section is for
self-directed traders and investors who like to "do it themselves". Every
trading day, Bulls and Bears will list long and short equity setups with
defined entries and stops. Note: A listing in this section does NOT
necessarily mean that the stock will end up as a part of the
ShadowTraderPro Model Portfolio. Plays listed here change daily and are
not managed or tracked by ShadowTrader unless traded via e-mail alert.
Long Ideas
DVN
| 72.42-72.21 |
69.14 |
Pullback to support of previous highs on dailies | |
COV
| 47.75-47.60 |
46.32 |
Coming into ascending trendline on dailies | |
SOHU
| 57.12-56.92 |
55.45 |
Looking for first touch of ascending trendline on dailies | |
Short Ideas
TRV
| 49.50-49.72 |
51.07 |
Anticipating touch of descending trendline on dailies | |
ShadowTrader Model Portfolio
The matrix below shows
all current ShadowTrader Pro plays in the Model Portfolio. The Model
Portfolio contains only those plays that are sent out in real-time via
email. Bulls and Bears plays above are not actively managed or tracked.
Current open positions are on top, with positions that were closed in the
current calendar week on the bottom. Closed positions are moved out of the
matrix on Monday mornings and posted in our performance page here.
To get the most
out of your subscription and for detailed instructions on how to structure
your own portfolio, read our Swing Trader User's Guide
| OPEN POSITIONS - week of
01/11/10 - 01/15/10 |
| sym |
dir |
size |
date
entered |
entry
price |
date
closed |
exit
price |
target |
stop |
status |
mark
to
market |
p&l
points |
p&l
capital |
capital
commit |
| PPL | long | 225 | 01/11 | 32.00 | n/a | n/a | 34.30 | 30.85 | open | 32.15 | 0.15 | $34 | $7,200 |
 |
| CLOSED POSITIONS week of
01/11/10 - 01/15/10 |
| STT | long | 325 | 01/08 | 45.13 | 01/11 | 44.57 | 49.25 | 43.59 | closed | n/a | (0.56) | ($182) | $0.00 |
|
| GS | long | 50 | 12/30 | 165.50 | 01/11 | 173.5 | 180.00 | 173.50 | closed | n/a | 8.00 | $400 | $0.00 |
|
| WHR | long | 150 | 01/05 | 81.10 | 01/11 | 84.42 | 90.00 | 79.85 | closed | n/a | 3.32 | $498 | $0.00 |
|
| WHR | long | 100 | 01/05 | 81.10 | 01/12 | 82.60 | 90.00 | 79.85 | closed | n/a | 1.50 | $150 | $0.00 |
|
| FRT | long | 250 | 01/05 | 65.97 | 01/12 | 66.50 | 74.50 | 65.28 | closed | n/a | 0.53 | $133 | $0.00 |
|
| | TOTALS: |
225 | open shares (open capital committed doesn't include closed trades) |
$7,200 |
Click here for year to
date Model Portfolio Performance - 2010
Click here for Model Portfolio Performance - 2009
Click here for Model
Portfolio Performance - 2008
|
